Guides / Cookbooks

Cookbooks · Risk and execution · Intermediate · about 8 min

Detect two-way risk

Find names where both a 5% drop and a 5% rally are likely within a month, which means a wide range rather than a direction.

1. When to use it

   A directional screen misses names that are likely to move a lot either way. Those matter for sizing, for stops, and for options: a wide expected range is what a long straddle or strangle needs, and what a premium seller is exposed to.

2. The request

   Two forecasts, a direction check and an ATR rule as a cross-check on how wide the daily bars already are.

   {
     "model": "ora-fin1",
     "state": {
       "symbol": "AMD"
     },
     "questions": {
       "drop5": {
         "type": "yes_no",
         "instructions": "Will it drop at least 5% at some point in the next month?"
       },
       "rally5": {
         "type": "yes_no",
         "instructions": "Will it rally at least 5% at some point in the next month?"
       },
       "up_week": {
         "type": "yes_no",
         "instructions": "Will the stock be higher in a week?"
       },
       "wide_atr": {
         "type": "yes_no",
         "ask": "atr_pct(14) > 3"
       }
     },
     "actions": [
       {
         "id": "two_way",
         "when": "drop5 >= 0.6 and rally5 >= 0.6",
         "do": "slack",
         "connection": "trading-desk",
         "message": "{{symbol}} ({{as_of}}): two-way risk. 5% drop {{drop5|pct}}, 5% rally {{rally5|pct}}, higher in a week {{up_week|pct}}. Compare with the implied move before selling premium."
       }
     ],
     "dry_run": true
   }

   Open this in the Playground

3. The real response

   AMD:

   {
     "model": "ora-fin1",
     "answers": {
       "drop5": {
         "type": "yes_no",
         "yes_no": 0.763
       },
       "rally5": {
         "type": "yes_no",
         "yes_no": 0.836
       },
       "up_week": {
         "type": "yes_no",
         "yes_no": 0.577
       },
       "wide_atr": {
         "type": "yes_no",
         "yes_no": 0.9441,
         "rule": "atr_pct(14) > 3",
         "basis": "rule"
       }
     },
     "usage": {
       "input_tokens": 394,
       "output_tokens": 16
     },
     "context": {
       "source": "server",
       "symbol": "AMD",
       "as_of": "2026-10-30"
     },
     "version": "ora-fin-0.1.1",
     "actions": [
       {
         "id": "two_way",
         "fired": true,
         "status": "dry_run",
         "do": "slack",
         "connection": "trading-desk",
         "preview": {
           "text": "AMD (2026-10-30): two-way risk. 5% drop 76%, 5% rally 84%, higher in a week 58%. Compare with the implied move before selling premium."
         }
       }
     ]
   }

   Both moves are likely (0.763 and 0.836), the 14-day ATR is above 3% of price (0.9441), and the week has only a mild lean (0.577). The alert fired. The same request for SPY gives 0.203 and 0.229, ATR rule 0.0537: narrow both ways, and the action was skipped.

4. The code

   cURLPythonJavaScriptPHPGoJavaC#RubyCopy

   Requires curl 7.76+. Save as run.sh, then: bash run.sh

   curl -sS https://oramodel.com/v1/systemone \
     -H "Authorization: Bearer $JEV_API_KEY" \
     -H "Content-Type: application/json" \
     -d '{
     "model": "ora-fin1",
     "state": {
       "symbol": "AMD"
     },
     "questions": {
       "drop5": {
         "type": "yes_no",
         "instructions": "Will it drop at least 5% at some point in the next month?"
       },
       "rally5": {
         "type": "yes_no",
         "instructions": "Will it rally at least 5% at some point in the next month?"
       },
       "up_week": {
         "type": "yes_no",
         "instructions": "Will the stock be higher in a week?"
       },
       "wide_atr": {
         "type": "yes_no",
         "ask": "atr_pct(14) > 3"
       }
     },
     "actions": [
       {
         "id": "two_way",
         "when": "drop5 >= 0.6 and rally5 >= 0.6",
         "do": "slack",
         "connection": "trading-desk",
         "message": "{{symbol}} ({{as_of}}): two-way risk. 5% drop {{drop5|pct}}, 5% rally {{rally5|pct}}, higher in a week {{up_week|pct}}. Compare with the implied move before selling premium."
       }
     ],
     "dry_run": true
   }'

5. Act on it

   • Size: a wide two-way range argues for a smaller position and wider stops (Size positions by volatility regime).
   • Options: compare the answers with the move the options market already prices (for example the at-the-money straddle as a share of spot). If the implied move is already large, the range is priced in; if it is small, owning the range is worth a look and selling premium deserves caution.
   • Direction: don't infer one. up_week near 0.5 says the forecast has no strong lean.

6. Variations

   • Stricter: drop5 >= 0.7 and rally5 >= 0.7; or require the ATR rule too: and wide_atr >= 0.6.
   • Which way does the range lean? Compare rally5 − drop5 across names (Rank a watchlist).
   • Run it on the whole book every evening as a workflow with a digest set to fired.

Information, not investment advice. Every number on this page is a real response for the session shown; answers change with each session.

What's next

• Size positions by volatility regime
• Risk guardrail before an order